Bourses ended a day of narrow trading by tracking bond markets higher after what was interpreted as a positive speech by Alan Greenspan, Federal Reserve chairman.
The FTSE Eurobloc 100 index gained 0.5 per cent at 1,090.85. The FTSE Eurotop 100 rose 0.4 per cent to 3,078.26 and the broader FTSE Eurotop 300 improved 0.4 per cent to 1,331.12.
Paris posted its second successive all-time closing high on a day heavy with corporate news.
Thomson-CSF, the defence electronics company, led the market higher on hopes For full FTSE European indices see Euro Markets page. the government would let Alcatel, the telecoms and engineering group, increase its stake. Thomson rose 2.43 or 7.4 per cent to 35.30, while Alcatel gained 2.70 or 2.1 per cent to 128.90.
Frankfurt ended a subdued session with the Xetra Dax index up 32.84 at 5,415.5 to extend the latest rally to 124 points in three days.
Siemens moved ahead strongly for the second day running on news of a planned joint venture with Fujitsu of Japan to create the world's third biggest computer group. SAP rose to 400.10 after Goldman Sachs stepped up its 12-month target price to 410, but the shares moved lower in late trading to close at 400, down 20 cents.
In Amsterdam the Aex rose In spite of the recent failure of merger talks with Dutch rival Wolters Kluwer, the stock rose to 11.95 before closing up 30 cents or 2.6 per cent at 11.65 in 8m shares traded.
Telecoms leader KPN added 1.45 at 46.55 on news of an aggressive marketing policy.
At the other end of the day's performance charts, Akzo Nobel fell 1.50 at 40.65 and Royal Dutch came off 65 cents at 57.80.
Zurich put UBS under the spotlight amid rumours that the bank might become involved in a French banking bid battle.
The UBS shares closed SFr12 higher at SFr479 on a story that the Swiss group might help BNP in its double bid for Societe Generale and Paribas by buying Paribas activities. UBS declined to comment, while BNP denied the story.
